Business Management

The Road Less Traveled - Marketers Selling in Alternative Ways

With consolidation of distributors comes consolidation of the nail lines they choose to carry. Today, nail manufacturers are finding themselves looking for non-traditional avenues to get their products to potential clients.

It wasn’t so long ago that manufacturers were hawking their wares from salon to salon or even peddling their products on the streets. Today, few manufacturers depend on these methods to sell their goods. Nail technicians now have several choices about where to purchase products. Distributors’ salespeople call on salons in person, a nail tech can head to her local beauty supply and try products before she buys, she can browse a full-color catalog and call in her order, or she can log on to a distributor website at any hour of the day to place her order.

Ami McClure and Traci Dungan, owners of Pro Files in Cape Coral, Fla., are also Young Nais distributors.

“Nail technicians are ordering from catalog companies or the Internet when they cannot find the products they are looking for,” says Tony Cuccio, CEO and president of Star Nail International. “They are going direct in many cases. Nail technicians are complaining that they need to go to 10 sources to get all of their products and tools. Some will even shop at more than 20 locations just to find everything they need and want. The one-stop shopping days are definitely history.”

That change in shopping attitude may be due to the fact that the nail industry has consolidated in recent years, says Cuccio. “Many smaller nail companies have disappeared. Along with that, many full-service distributors are consolidating the nail lines they carry. Because of that, nail technicians are facing challenges finding a broad selection or the products they need to purchase for their salon use.”

That may be the reason some manufacturers have diverted from the norm and have opted for different methods of distribution. These alternate routes have brought them success. Some manufacturers haven’t completely eschewed the traditional distribution method. They are still working with distributors but also focusing on other ways to distribute their products and boost their business even more.

We’ve profiled a few manufacturers who are adapting to changes in the nail industry and are making sure their clients still have access to their products — even if it means going a non-traditional route.

Company: Backscratchers Salon Systems (Elk Grove, Calif.)

Years in business: 22

Distribution process: The company still sells to wholesale professional distributors. What they have done differently is gone with smaller distributors — nails-only distributors that sell directly to nail salons. Backscratchers has also started selling products directly to customers on its website. Licensed nail technicians can register and shop on the site and have products delivered to their home.

“In the beginning we sold direct to nail techs and made all of our products available at trade shows and at schools,” says CEO Michael Megna. “Once we built the demand as a manufacturer, and in the 1980s when nails became popular, beauty industry distributors became interested and the distribution process changed.

“After manufacturers built up the market by providing classes in beauty schools, distributors came onboard with their channel of distribution. Business was good then. Now much of that has changed, so we are looking at returning to selling direct in certain markets.”

Company: Young Nails, Santa Fe Springs, Calif. Years in business: Six Distribution process: CEO Greg Salo says the company does not sell to traditional big distributors because they don’t focus on nail care. “They put nails on the backburner to hair,” he says. “I tried to go the traditional route, but it didn’t work out for us. There were too many distributors interested in just dealing with the bigger players.”

Instead, he says the majority of the distributors Young Nails works with are exclusive to them. “We don’t have 20 distributors in one state. We usually only have one,” says Salo. All of the company’s distributors also do nails. Some of them work solely in salons while others may work in salons and also at a distributor.

Now it’s not uncommon for Salo and his staff to get approached by people wanting to distribute his products. “I’ll usually qualify them with their skills as a nail tech,” he says. “It’s a commitment. They have to stock inventory and supply the demand. Our distributors need to be prepared, well stocked, and have tons of knowledge.”

But if a nail tech isn’t in an area where Young Nails has a distributor, then the nail tech can purchase product directly from the company

Company name: Galaxy Nail Products, Corona, Calif.

Years in business: 18

Distribution process: While Galaxy does some direct sales, most of their business comes from selling to people who only sell Galaxy products. “We’ve been more successful that way,” says founder and CEO Kym Lee. “Our product is unique, so having someone put it on a shelf has never worked for us. Having someone who only sells Galaxy products or is selling direct has been more successful.”

Galaxy trains distributors on how to use and sell the product. And Lee says nail technicians benefit because the distributor is educated not just on how the product works but also on what causes lifting, the different types of nail beds, etc. “We need a distributor to know all of these things, so they can give technical advice when someone is having difficulties. That way we can keep that customer,” says Lee.

Since Galaxy does not manufacturer nail polish, its distributors can sell polish, but only from companies that do not have acrylic systems.

Nail technicians can also buy Galaxy products online. Lee says newer clients seem to be more comfortable ordering products online while nail technicians who have been using the product for some time prefer calling in their orders.

Company name: Estelina’s Spa Products, Westlake Village, Calif.

Years in business: 18

Distribution process: Company president Estelina sells her products through the traditional distribution method but also has a few different alternatives. In the last five years, she’s been focusing more on visiting cosmetology schools and educating students on her products. Then, she sells the products to them. “After that we hope the students will continue to buy from us,” says Estelina. “A lot of schools end up picking up the line. We have schools we sell direct to, and they sell to students.”

Students receive a 15-20% discount on products. “I tell them to look around, buy a small kit, and try something,” she says. So far her method seems to be working. Estelina says about 50% of students continue to buy her products after graduating.

She also sells her products on her website. “We’ve been doing web sales for about two or three years,” she says. “I don’t really try to put it out there for the whole world to see, but if a nail tech is looking she’ll find us.”